Washington Prime Secures $35M Loan for Newly Acquired Montana Shopping Center
Washington Prime Group says it expects to use loan proceeds to reduce outstanding balances on its credit facility and for its ongoing redevelopment efforts.
MISSOULA, MT—Retail REIT Washington Prime Group has secured $35 million in financing for its recently acquired Southgate Mall property here.
The interest-only loan provided by First Interstate Bank has an initial term of 36 months and bears interest at a fixed rate of 4.48%. There are two one-year extensions available under the loan agreement. Washington Prime Group says it expects to use loan proceeds to reduce outstanding balances on its credit facility and for its ongoing redevelopment efforts.
Columbus, OH-based Washington Prime Group acquired the nearly 448,000-square-foot Southgate Mall for $58 million earlier this year, according to multiple press reports.
Lou Conforti, CEO and director of Washington Prime Group, says the financing for the property by First Interstate Bank “serves as validation regarding the viability of our asset. As a leading $12-billion regional financial institution serving Montana, Idaho, Oregon, South Dakota, Washington and Wyoming, I’d contend these folks know what makes sense when it comes to the Northwest.”
He adds that the deal is also satisfying because it disproves pundits who complain about the lack of commercial mortgage availability. Conforti also says it’s always satisfying to disprove those pundits who pontificate about the absence of commercial mortgage availability. Plus, he notes, “Missoula is a really cool place where cowboy boots and Birkenstocks live in harmony.”
The company plans to reposition two anchor spaces at Southgate Mall, which were previously occupied by Herberger’s and Herberger’s Men’s department stores until their closing in August 2018. Washington Prime states that it is in discussions with new tenants about possible lease deals for that space.
Southgate Mall is anchored by a mix of retail, entertainment and dining options, including a new nine-screen, dine-in AMC Theater complex; Lucky’s Market, a specialty grocer focused on natural, organic and locally-grown products, which replaced a former Sears department store; national home furnishing retailers Bed Bath & Beyond and Cost Plus World Market; a regional sporting goods retailer; national department store Dillard’s; Montana-style casino bars, and numerous national and local specialty retailers.
Along with Lucky’s Market, a group of restaurants including Café Dolce, Mustard Seed and Red Robin Gourmet Burgers and Brews are among the food and beverage options offered at Southgate Mall.
In addition to AMC Theater and Lucky’s Market, tenants at Southgate Mall that have opened, remodeled or expanded locations over the past 24 months include Athleta, Bath & Body Works, Gap and Gap Kids, H&M, Lane Bryant, PINK, Sephora located in JCPenney, Victoria’s Secret and White Barn.